Zhou: In fact, I was friends with the LEI, the next wave is called IOTi dark horse: July 31, the first Forbes China Innovation Summit, Qihoo 360 Chairman Zhou on Internet innovation first presented their views on the hardware and manufacturing in the future. He argues that \u0026 ldquo; things \u0026 rdquo; not apt to describe the next wave in the United States has a very fire concept called IOT. It is worth mentioning that in his speech, Zhou actually also clarified himself and Lei Jun is actually good friends. The following is the entire contents of his speech: I am back from the States, I go once a year to the United States mainly charge, because although the development of our very vigorous Chinese Internet industry, we have heard a lot of things are giants, with you nothing relationship, we have the development of the Internet in fact, I think more is not that innovation is more that demographic dividend, because we have the world's largest mobile phone users, so a lot of very simple business model as long as there are so many users a graft We also have a lot of high levels of the company. But they have to be innovative, I think you really want to go to Silicon Valley, I have visited a lot of American VC in Silicon Valley, and asked how he sees the future trend, because VC is always looking at the future of the company. The second I met a lot of start-up companies, because listening to a lot of startups fly or talk about some of their ideas do not fly, you can feel eyes were open, so I call it an innovative charging. This time to catch up with Google in the United States to publicize its policy, so I sum up one of the hottest concept in the United States, a man named IOT, that is the past, we called a few years ago we said things, things I feel the word is not very appropriate, as if from the original concept has been very hot, but is the concept of speculation, it is not really with the people of consumption, there is no real user's life with the people together, I think the word is apt IOT is anything should it interconnected, it has turned it into intelligent devices, should it connect with the Internet. There are a relatively hot thing is a robot, a lot of things once joined this cloud, this opportunity of artificial intelligence data processing, such as Shenzhen have a company called Oe do six-axis four axis drone aircraft, in fact, there is added intelligent control after cloud, to some extent it is also a robot, so these two concepts together. Look at Google this year released several products: combine binding Andrews and cars, combined with Andrews and watches wearable, Andrews and television, as well as combination of Andrews and smart home, you'll realize that the advent of a new era of discovery a. So I very much agree with Zhou Zongbian view, a more exciting era of entrepreneurship will come. Many Chinese Internet entrepreneurs have been forced to do with emotion, the past is you killed, now you eat it, it monopolized the more users and traffic, including China had 500 million Internet users computer. Now China has a billion mobile phone users, so we must stand now look to the future, if we talk today of millet phone competition or to learn what to do instant messaging giant, I think have been others seize the opportunity, we should look to see Today just started on the project, although it may erupt in the future will really be three to five years, but I think this is our chance to many innovative corporate entrepreneurship. I think the biggest opportunities? Just think, even if each person an average of 1.5 mobile phones, China's future also is up to 1.5 billion mobile phone ownership, the computer may be 600 million units, these things are OK. But I tell you that if you imagine the future of your home each bulb every outlet, all the appliances in your home, you wear glasses, wearing a watch, including think you can see if any device is not called a mobile phone phone inside may have been an intelligent system based on Android, and make use of 4G or WIFI network connect with the cloud, then I should be in five years China will be two billion devices connected to the Internet. The two billion devices will have a huge amount of data every day, so I think the really big data era I think have not come. You think about the future in this opportunity, including Zhou referred to reshape and reinvent the industry, there will be a huge opportunity. So yesterday I just saw an American scholar wrote many books, he called TAK (sound), I agree with him a point, he said that today you re-invent you see any hardware device to do two things, first, it intelligent, and the second is connected to the Internet, in fact, there is a cloud-based, so-called cloud technology is a lot of talk about it a lot of control logic AI deal is in the clouds, by way of big data to be processed, then you I found that this Inside you will find many of the existing industries are going to reshape or remodeled, so I think this is a huge opportunity. And we talk a lot of people talking robot autopilot, in fact, we expect how great artificial intelligence technology development, but to be honest the traditional artificial intelligence has not been much progress in recent machine translation in voice recognition, face recognition Many aspects recently achieved a major breakthrough, not that the traditional artificial intelligence, but thanks to big data, when I use vast amounts of data for this time an algorithm to analyze big data, you'll find a lot of the traditional manual intelligent question really is to use big data to get. This is my first point, I think all of you in terms of this may be a new Internet, 1.0 is the PC Internet, mobile Internet 2.0, 3.0 may be to the Internet becomes ubiquitous, said the so-called IOT This is a great opportunity. But this great opportunity which actually contains a lot of challenges, and now the whole of China in particular, do a lot of a lot of the company's traditional industry and manufacturing, we tend to give it to hang a label called traditional enterprises, they may also see a tremendous opportunity, But how to meet this challenge? rather than that being subverted by the Internet, because the Internet is now on a lot of sectors and industries have shown a powerful force to destroy another building, a lot of the Internet industry has been subverted, so We now have an Internet anxiety. Everyone in the transition process except to say that I put outside my equipment, intelligent, I should do something about it? I often communicate with many companies, if you just take advantage of Internet technology, this is only a first step, the first Second step is to say if you just use the Internet this type of marketing, for example, I do electricity suppliers, I shop on Taobao Jingdong, I went beyond the traditional channels to sell my product, I think this is still a primary use of the Internet stage, it is the use of the Internet tactics, not strategy. How to make your business a real business ideas from, philosophically, from the trail can become a real thinking in line with the so-called Internet companies do, how to do Internet innovation? I would like to share a few feelings. The first time when you transition to the Internet, I think not only is the Internet's hardware thing, the Internet companies are now a lot of people to do the hardware energetic, I have also had a lot of pull do not fly a small partner to make mobile phones, finally ended in failure, the hardware we have done a lot of attempts, but today still persevered, I feel that the hardware is still pretty high threshold. Software does not do the same, this software is not very good today, I will sent out, and user feedback to me, and then I modified the software itself is free, if you think I'm a software problem, you do not have enough. But do the hardware is not the case, then if you made a faulty hardware version, the user is also spent the money to buy, you will find that this is basically Nike Air Yeezy a disastrous result, users of your death curse. You want it to recover these hardware changes may mean all set aside. So the hardware do I think it is a pit. A very interesting phenomenon, that is for example a factory in Dongguan, in fact, the same hardware companies can do, Air Jordan Others I think these people in the past the hardware industry profit is very thin, very competitive, in fact doing is quite bitter. Finally, I believe that survived are very good business. But you find that it's high sales, but because it is not yet the Internet model, even if the final hardware can be made to do great quality, the company can have several billion a year in sales, the company's valuation is still very low. But on the other hand, some of the little guy can do hardware from OEM hardware plus an Internet concept, despite how they made out of the hardware is not clear, but they gave it added an Internet tag, we Shong comrade go, I want to invest in you, from the lowest one million dollars. Joke, so you'll find the formation of a strong contrast, so my final point is that if the Internet companies in the new wave of hardware I think the Internet is sure to work closely with the company, so this is a lot of the hardware business, if I can take such an opportunity, not only to make their products intelligent, not only for their products and the cloud of the Internet, but also make their enterprise business model, to make their own business from the traditional label relatively low profits or even this Air Jordan 14 Retro low levels of such a special tradition of label, perhaps your business can achieve the transformation of the Internet, you can also enjoy the Internet in a lot of capital back, in fact I think this is a great opportunity. We open today this will I think not white to visit, I would also like to do a lot of small manufacturing and Internet cooperation partner. The first one I think when you do internet hardware, the first user-oriented concept, the user first topic I think this seems to be old-fashioned, but in fact there is no industry in the traditional users of this concept, we think about our past What is the concept? Is the concept of the customer, who is the customer? Ask me to pay that person, in fact, there is no complex business under the sun, I do this thing to sell you, you pay me such trading is complete. But the Internet this idea I think still have to change it. Why? First, some services and some features may not be user you have to offer to pay you, you have good service to customers, which means you want to expand your influence, you can not come on just look at those may pay to you people, because the hardware can not suddenly sell one billion Chinese people are buying, they may start to buy hundreds of thousands, but those without money to you or do not buy your product people how they tell you establish contact? This is something you should consider. For example, many people think I told Lei Jun is the sworn enemy, in fact, I was friends with the LEI. You look to sell large millet phone, you do not see millet phone before they made a modification meters away, modify the Andrew system, allowing users free to use. On the Internet really attract your fans and users, though these people are not your customers, users must first have, and then have clients. I think this is a basic law in the Internet. The second and more importantly, if you want to truly Air Jordan 8 Retro transition into the Internet business, the nature of Internet business we provide a service, so you and your users with customers to be transformed into business between users can not be one-shot deal, in the past we selling hardware, the product through advertising the actual use of information asymmetry, and rhetoric to convince users to buy our stuff, a lot of our companies want the users never find me, selling traditional television is the truth, the user may then come to him may or return to service, so there is no contact between you and the user, the customer does not have value, real attention to the users of Internet relationships are saying you have downloaded the software, and business does not end, the business has just started, you got my hardware our relationship between the two is just beginning, how do I pass this hardware can provide ongoing service, and finally put this into my user stickiness users, which is a challenge for many companies. For example, a recent music, as do Internet television, past TV competition, the television industry for over twenty years to do big old TV, people are selling hardware, but they are this year's TV Riga intelligent modules, I think not add intelligent module becomes a smart TV, you have no business intelligence. Internet is no bottom line, they rushed to buy a TV, I believe that music, as 70-inch sell eight thousand dollars to someone willing to buy, but I think it is the loss of each. We buy not buy the competition has gone from watching TV to see the shape size, my TV did not buy a home there you have a lot of pieces to me, if not so many pieces he would not buy this TV. Because the hardware used to do is to sell your TV, now doing television was forced to do. You will find that the concept of the business model is the user enormous challenges. So I think you're going to want my hardware model of how to engage customers from one-time, I can become a turning him into me to contact the user. Many elderly people can not understand the Internet guys chaos burn, like some time ago Didi taxi taxi drops and fast, I did not distinguish who is who, they are not only willing to lose money paying the money to do that, a lot of people said to be white taxi take a month to burn a billion, a month burned 1.5 billion, which is to allow users to install its software in order to use its software to develop the user's habits. So I think a lot of people this is the most important transition to the Internet. And on the Internet, I think first of all have a lot of business to create value to the user, allowing users to feel you this stuff is really good, then you can really make money on the Internet. The second key word is called experience, experience is king, I think the Internet today is actually leveled from the world, so that information becomes more symmetrical, traditional advertising I always think there is a micro-speech, traditional advertising is based on a lot of information Asymmetric do, buy sell fine, so the Chinese people will be vigilant, but the truth of the fact that the Internet will allow consumers access to an unprecedented rights. We do so in the past when in truth there is an error on marketing ideas, we often pondering some of the selling points, we often wonder some of us think is introduced in order to sell a selling point, but the selling point I told you about, if the consumer get your product can not empathy, can not really appreciate the original consumer will pay you this, the future will not. So your design ideas to change, not necessarily do a lot of features, you must think consumers want to get your product in the future, what kind of features to give him a delightful surprise, what kind of features make him truly feel You give him to create value. Let me give you two examples. There was originally one operator to sell the phone, they say my phone green no radiation, the phone did not very successful, and why? Because no radiation at this point you say you and you can judge it? The vast majority feel. Including today many Chinese mobile phone battle that inside I was seriously studying them, such as Huawei do mobile phones do very well, I think China has done a lot of the traditional cell phone manufacturers do better than millet difference, but you will find it Because they do not understand the Internet user experience point of view, they are more my skills and ideas propaganda, end-users can not perceive. For example, you say that your internal phone what to do, you know what. Instead other phones run a minute, we all know from childhood than 90 points 100 points run. Last year, for example, a mobile phone what 7710,6630, I just nonsense figure called, I heard fainted. So Apple special simple, apple 6 to come out, six or five? Of course six, so I want to know my apples into apple 5 6 a. So you will find in the user's perception of the Internet is the most important, if your product is good, the user will not be perceived, it is difficult to get many of our products consumers. The third I think is very important, I would like to say a keyword called free Internet in the most terrible weapon is free, free is the hardest thing to learn martial arts, I recently prepared to write this book, I had to come up with a name called holy canon publishers do not agree. Write the expected success of the first page, we must first since the attack, so I added eight words since the attack may not even be called a success. So Free is a double-edged sword, you make good use of the free that it can help you quickly forward. But you with the bad, many Internet companies are free subversion. Free Internet, today to talk about the hardware is not free? In fact I speak with you for free on the Internet can be set up in a normal business model, because it can quickly accumulate a large number of users for free, and I have talked about the user as a foundation, In fact, the Internet you can find many ways to the realization of the user, not opposite-user basis, we talk about where we model is B2C, B2B, this is imagination. But I actually think the hardware is not necessarily for all the hardware, hardware for many popular products, I actually think free will is a possible subversion. That hardware free of charge, has two meanings, the first is when your hardware in accordance with Moore's Law, the cost is very low, you find that if you Nike Air Yeezy send the hardware, UP value you can get back the hardware cost is higher than the user , such as exist in the telecommunications where to send phone calls, it is actually a very extreme hardware for free. Google had done a test in Japan, Google Android why the original did, they found that if the Android phone's cost assumptions do one hundred dollars or less, they found that in Japan, said that if you send a user, if the user stick with a years there as long as he used the Google search, with Google maps, read Google's video ads, also played Google in the game, probably in Japan, spending power is relatively strong, UP value for each user is higher than one hundred dollars, so this means that delivery of hardware as possible. But for the vast majority of businesses do you think you fooled me, we sent went bankrupt. There is also a free hardware is the hardware to be sold at cost price, that is the hardware itself making profits, unlikely. I think it is very competitive, then it is likely you do not expect the hardware to do a high profit, its profit will be reduced. I am talking about is a popular mass consumer product, so you can see what prices these years, only computers, laptops, cell phones are increasing performance, then lower and lower prices. So today we start Nike Shoes a company to do a lot of hardware you have to start doing a consideration, if you do not, your competitors may do so, so if you can not go deal with this free business model will bring it terrible. In the Internet where, when we do free anti-virus, many people do not understand, feel free to do it is not a liar, it is not fooled it? Finally, the fact that we not only eliminate the free antivirus against competitors, but more important is to quickly put China hundreds of millions of Internet users have become our customers, then suffer the largest in the free company called Jinshan, Jinshan is also chairman Lei Jun, Lei Jun students so lessons learned from this, in fact, because the hardware free of millet example, millet and not a hardware free delivery, but the hardware may now maintain a very modest profit. Millet has just launched a long time to introduce dual-core 1999 I think no rivals, the most fun is to do business with no opponent, then any cell phone manufacturers do the same phone at the time because of various reasons are sold three thousand dollars, So you're saying this thing for Chinese users, price is always the most intensity. Someone told me that now millet brand, now how feelings of how we can sell, how to sell this thing I do not understand feelings. I do not have this ability, only to sell products. Even for such a successful company millet, red rice, you can look out of 699 phones, m3 why the price cuts, now down to 1499 or 1299, but in fact you find in China hardware such low profit or no profit competition It will be the norm. However, I would ask a question since you are free, and how to make money? If you do free to do cross-border, there is a saying called Nike Air Presto the wool in pigs, simple past your business, you are selling hardware, today do not make money selling hardware, the hardware sold today are access to the user, this time you will not be able to own and then narrowly defined as I was to do the hardware business, if you can not cross-border, in this business you might be doing the Internet hardware very weakened, this time you can through cooperation, through investment, through a variety of ways, be sure to cross-border. The future may be possible to sell mobile phones for example through the game on the phone, read phone to make money. After selling the TV to sell the box, I feel a certain box television to make money through the program free of charge. So the core competitiveness of enterprises in the new business of this ability, in fact, presents a huge challenge. Talked about Internet innovation, in fact, there are many keywords, and what focus, fast, but I think these things are tactical, If I had to sum up, I really think you're going to really understand why the subversion of Internet companies, or Why do these companies do it? There are three key words, a user first, how the one-time business into a user's connection with you, the second is experience is king, that is, from simply in order to sell, but really consider When you get this product say after me how to give him a particularly good an experience, allowing users to really feel this kind of value. The third is that you have to learn to deal with this challenge to bring free, and you consider yourself to say you can not put your business to do an extension, the traditional business is your own initiative to free up. So why the Internet is so nice competition today, all the companies are doing cross-border, everyone wants to take your money out of the business for free, putting up new money mode. So this is the best of times, the worst of the times. But I believe there are a solution is cooperation, I feel that in terms of Internet companies in the short term may be difficult to do a lot to say to go beyond traditional hardware company, how do we find a cooperative, in this cooperation or by slowly evolution, very long time, by mutation, there is the Internet genes and genes combine traditional hardware, so we can do hardware service, we have established a new business model for the Internet mode. There are a lot of opportunities. Every day we are in a giant thing in the cracks of survival. So I can not do anything, I can not do anything, but I have the number of users, I personally do not flicker always worse than mine capacity, so if you have good hardware have good ideas are welcome to write me e-mail, we can help you establish an Internet background cloud services, more importantly, let's look at how to put your business model from traditional hardware to get the meager profit sales to eventually become able to do the Internet to do the service of the company, we are looking forward to this opportunity. Thank you all!